Fixed Deposits (FD) have been a popular investment avenue for a long time due to fixed returns and safety. However, it is important to know what happens to the FD amount if the account holder dies. Let’s look at the process to claim an Fixed Deposit after death of the account holder.
FD Maturity Claims After the Death of the Account Holder
Individual Account
An individual account holder may or may not have a nominee. Here is how both scenarios can be dealt with in case of the account holder’s death.
- When a nomination is available: In such a case, the nominee can claim the FD maturity value by submitting the death certificate of the account holder and KYC documents. The nominee also has to submit prescribed identity proof.
- When no nomination is available: If the account holder didn’t appoint a nominee, the legal heirs can submit the claim form, death certificate of the account holder and succession certificate to receive the FD value. A legal heir is a person who is legally entitled to receive it in case of the demise of the account holder.
Joint Account
Upon the death of the joint account holder, the FD value can be claimed in either of the following ways in different scenarios.
- Either or survivor joint account: The survivor can continue with the FD account after producing the death certificate of the primary account holder.
- Jointly or survivor account: The survivor can keep up the FD account till maturity and assume its ownership after submitting the death certificate of the primary account holder.
- Former or survivor joint account: Former here means the primary account holder. Upon his/her death, the survivor can assume FD account ownership after submitting the death certificate of the primary account holder.
- Anyone or survivor joint account: After the demise of the primary account holder, the next member can assume the primary role till FD maturity. In the case of more than two account holders, the next member needs the consent of all account holders for this transition.
Premature Fixed Deposit Claim After Death of the Account Holder
If the survivor wants to claim the FD before its maturity, here is how it will proceed.
Individual Account
In case of an individual account holder’s demise, the nominee or legal heirs can request for the premature withdrawal of the funds. The claimant is required to submit the death certificate of the account holder, KYC documents of claimants, and other supporting documents as asked by the financial institution. However, a premature withdrawal may result in a loss of interest.
Joint Account
In case of a joint account holder’s demise, it is possible to claim FD withdrawal before maturity. However, it requires the consent of the survivors and legal heirs, if a mandate was given while opening the account.
If none of the joint account holders exists, the nominee can claim for premature withdrawal of the funds complying with the requirements. If no nomination is available, the legal heirs can do the same.
Documents Required to Claim Fixed Deposit After Death
Proper documentation is important for easy settlement after the account holder’s death.
When a nomination is available
- Claim form
- Death certificate of the account holder from the local authority
- Photo ID, address proof and other KYC documents of the nominee
When no nomination is available
- Claim form
- Death certificate of the account holder from the local authority
- Succession certificate
It is important to understand how the funds can be claimed in the absence of the account holder. This helps avoid any inconvenience in future. It is advisable to ensure that the funds go to the right person in the absence of the account holder.
Frequently Asked Questions
It is not compulsory to appoint a nominee. However, it is advisable to appoint a nominee so that the money can be easily transferred to the person who is legally entitled to receive it in case of the demise of the account holder.
You cannot appoint more than one nominee for an FD account, whether individually or jointly held. However, you can appoint different nominees for your different FD accounts.
Yes, following the account holder’s death, his/her nominee may continue the FD.
For the settlement proceeds to be credited or remitted, the claimants need to provide the beneficiary account details and necessary documents.
Banks settle the claims and provide money to the nominee within 15 days from the claim date.
